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APPROVE BY MOTION RECOMMENDATIONS FOR USE OF $27,170,185 OF CARES ACT FUNDING
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RECOMMENDATION
It is recommended that City Council approve by motion:
1. The recommended distribution of funds between categories of need identified by the City Manager,
2. Authorize the City Manager to appropriate funding upon receipt of funds, acceptance of application, or other authorizing documentation from the state,
3. Give the City Manager the authority to determine the specific allocation of funds among community partners and execute each of the contracts, and
4. Give the City Manager authority to reallocate funds among approved priority goals and partners as needed to maximize the impact and benefit to the Stockton community.
The City Manager is authorized to take appropriate and necessary actions to carry out the purpose and intent of this motion.
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Summary
This recommendation of priorities and distribution of funds is in response to the State of California’s adoption of the Budget Act of 2020, Control Section 11.90, Coronavirus Relief Fund Allocations for Cities and Counties, which allocates $27,170,185 to the City of Stockton to address the public health and safety impacts of COVID-19.
DISCUSSION
Background
Based on the State’s population, California received a total of $15.3 billion Coronavirus Relief Funds (CRF) provided in the federal CARES Act, with $9.5 billion paid to the state and $5.8 billion paid to cities and counties with populations over 500,000. Control Section 11.9 of the Budget Act of 2020 authorizes the Department of Finance to allocate $500 million of the state’s share of CRF to cities and counties with populations of less than 500,000. Federal law specifies that these funds may only be used for unbudgeted costs incurred related to COVID-19 relief efforts between March 1, 2020 and December 30, 2020. All funds must be spent-not merely encumbered-by the end of the year.
Funding is contingent on the counties adherence to federal guidance, the state’s stay-at-home requirements and other health requirements as directed in gubernatorial Executive Order N-33-20, any subsequent executive orders and statutes, and all California Department of Public Health orders, directives, and guidance issued in response to the COVID-19 public health emergency. The state will be assessing each local recipient spending plan on or around September 1, 2020 and reserves the authority to reallocate any funds not yet spent by October 1, 2020, or not reasonably anticipated to be spent by December 30, 2020.
On June 30, 2020, the State of California, Department of Finance released its guidelines and self-certification application for Coronavirus Relief Fund Allocations for Cities and Counties. To receive funding, cities and counties must complete and email the CRF Certification Application form to the Department of Finance between July 1 and July 10, 2020. Allocations will be made in installments, with the first installment anticipated to be only one-sixth of the total allocation. The state has not confirmed information on additional allocation amounts or their schedule for distribution.
The City of Stockton executed and sent its CRF Application to the Department of Finance on July 1, 2020 and anticipates receiving the first allocation of funding sometime in mid to late July.
Present Situation
Through discussion guided by the City Manager, four main categories of need have been identified: General Fund Expenditure Offsets, Housing/Homelessness/Small Business Relief, Community Well-being, and City Government Supplies and Equipment. Each category is broad in scope with more specific needs being identified as we continue to adjust to the updated guidelines coming from the State.
In an effort to be as prepared as we can be, and work as efficiently as possible under the circumstances, the City plans to first utilize partners and providers who have already demonstrated success with these types of programs, while also continuing to research additional resources to add to our program.
General Fund Expenditure Offsets
It is recommended that the City provide approximately $2,070,185 to offset unbudgeted general fund expenditures incurred between March 1, 2020 and December 30, 2020, as allowed under both the State and Federal guidelines. Expenses in this category may include emergency expenses not allowed for or cover by the FEMA reimbursement, homeless encampment clean-ups that have already occurred in excess of those originally planned for, increased security services at City facilities to both assist in maintaining social distancing protocols and provide for additional coverage at unoccupied sites as a result of the stay-at-home order, and provide for additional services at our parks and other facilities to discourage the community from gathering (i.e additional signage, removal and installation of basketball hoops).
Housing, Homelessness, and Small Business Relief
It is recommended that the City provide approximately $13,950,000 to support low-income housing concerns, delivery of services to the homeless population, and support our local small businesses. This category may include programmatic distributions to support rental, mortgage, or income relief for our community members whose income or employment has been impacted by COVID-19, provide support for permanent supportive housing and rapid rehousing services, continue support to our local homeless shelters, and continue to provide small business support through our existing platforms.
Community Well-being
It is recommended that the City provide approximately $3,950,000 in community well-being to enhance services through the end of calendar year 2020. These funds may include contributions towards activities like continuing our efforts to support community hygiene by providing portable restrooms and wash stations in areas more heavily populated by the homeless, providing Personal Protective Equipment (PPE) to community members in need, continuing homeless clean-up and outreach by supporting our Homeless Outreach Teams (HOT), and providing additional funding to our food banks and other food service providers, as allowed under the guidelines.
The most significant item in this category is an Ancillary Community Support Notice of Funding Availability (NOFA) that would allow our Economic Development Department to provide grants to individuals, under a broad spectrum of qualifications, to provide a means for our community members to continue to receive essential services despite any income or employment change they may have recently experienced as a result of COVID-19.
City Government Supplies and Equipment
Lastly, it is recommended that the City provide $7,200,000 to support continued operations under the Public Health Crisis, which may include purchasing a stockpile of PPE supplies and equipment, improving our Emergency Operations Center (EOC), and updating our emergency communications and radios platform to include features like a mass communications component.
This category may also support the purchase and installation of contactless public restrooms for some of our parks and also purchase additional equipment to be used by our Public Works department so that they may continue to retrofit our facilities and public spaces to better meet the requirements for appropriate social distancing.
FINANCIAL SUMMARY
With Council approval, the City Manager is authorized to appropriate revenue and expenditure budgets for the $27,170,185 to support General Fund Expenditure Offsets, Housing/Homelessness/Small Business Relief, Community Well-being, and City Government Supplies and Equipment efforts throughout Stockton. The City Manager will ensure that the funds are distributed in the most expeditious, efficient, and compliant manner so that the recommended services and support can be made available to those impacted COVID-19 as soon as possible.
There are no other financial impacts to the City at this time.